In a recent survey conducted by Reuters on Wednesday, it was revealed that OPEC‘s crude oil production witnessed a decline in November, marking the first monthly reduction since July. The dip was primarily attributed to lower shipments from Nigeria and Iraq.
According to the survey, OPEC collectively produced 27.81 million barrels per day (bpd) of crude last month, indicating a decrease of 90,000 bpd compared to October. In the preceding three months leading up to November, OPEC’s oil output had remained either stagnant or experienced growth, with increased supply from African members and Iran compensating for lower output elsewhere.
Iran, exempted from the OPEC+ cuts, notably escalated its output in November, reaching a five-year high as reported by the Reuters survey.
Among the 10 OPEC producers participating in the OPEC+ pact, oil production witnessed a decline of 130,000 bpd in November compared to October. The Middle Eastern producers, particularly Saudi Arabia, demonstrated robust compliance with their announced cuts and additional voluntary reductions.
Looking ahead, OPEC’s oil production is anticipated to further decrease in early 2024 following the OPEC+ alliance’s agreement on additional cuts for the first quarter of the year.
Despite the expectations, the market response to the announcements made after last week’s meeting was underwhelming. The failure to convince the market that OPEC+ had a unified stance on cuts and quotas was evident, notably demonstrated by the absence of a group-wide cut.
In response to concerns, Russia’s Deputy Prime Minister Alexander Novak stated earlier this week that the OPEC+ group is prepared to take additional measures and deepen oil production cuts in the first quarter of 2024 to prevent volatility and speculation in the market.
Novak’s remarks on Tuesday echoed statements from Saudi Arabia’s Energy Minister Prince Abdulaziz bin Salman, who, on Monday, told Bloomberg that OPEC+ production cuts could extend beyond March 2024 if deemed necessary by the market. The minister also criticized commentators for their apparent failure to comprehend the intricacies of the output deal.